Alabama Medicaid will get through '14 with prayer and luck, but faces potential crisis in '15, says state health officer

MONTGOMERY, Alabama -- State Health Officer Don Williamson said the state’s 2014 Medicaid budget will work with prayer and luck but is facing a potential fiscal crisis in the 2015 budget year.

“With your help, God’s grace and the renewal of the provider taxes and nothing else going wrong, we will make 2014 work,” Williamson told lawmakers during budget hearings this afternoon.

Then things go downhill, he said.

“We are broke and we roll into ‘15 with a potential crisis facing us.” Williamson said.

Williamson said reductions in provider reimbursements, and other changes will help Medicaid "live" at a $615 million General Fund appropriation for 2014.

But Williamson said Medicaid will need more than $730 million in fiscal year 2015

Williamson downplayed expectations for how much can be saved by proposed structural changes to Alabama's Medicaid commission.

An advisory commission recently recommended that the state be divided into a series of community-run managed care networks to try to contain Medicaid costs.

The proposal will save some money and provide better patient outcomes, but it will not solve the financial problems, Williamson said.

"Nothing we do is going to fix a $100 million hole in Medicaid," Williamson said.

Alabama had about 900,000 Medicaid recipients in 2012.

Williamson said the state runs a bare-bones operation largely only covering the services and populations mandated by the federal government.

Republican Rep. Lynn Greer of Rogersville asked if the state should not just buy private health insurance for Medicaid families

“Would the state not just be better off buying family plan health insurance?

Williamson said Alabama would have to expand its program to be allowed to buy insurance instead of putting people on Medicaid. Williamson, said the other problem is federal rules require children be treated even if the private insurance didn’t cover the issue.